GigaCloud Technology Inc (GCT) 2023 Q4 法說會逐字稿

Good day, and thank you for standing by, and welcome to the GigaCloud Technology's fourth-quarter and full year 2023 earnings conference call. (Operator Instructions) Once again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today. Larry Wu founder and CEO. Please go ahead.

美好的一天，感謝您的支持，歡迎參加 GigaCloud Technology 的第四季和 2023 年全年收益電話會議。 （操作員指示）再一次。請注意，今天的會議正在錄製中。我現在想把會議交給今天的發言者。吳偉強創辦人兼執行長。請繼續。

Thank you, operator, and thank you, everyone, for joining us on the call today, 2023 and the fourth quarter in particular, have marked a significant inflection point for GigaCloud, which has changed the trajectory of the business and that we believe will change the way people think about the industry. We have jumped in order of magnitude in the scale of our business and the potential of our supplier fulfilled rating model. On the top line, we saw revenue increase to $244.7 million for the quarter, up approximately 95% period-over-period.

謝謝運營商，謝謝大家今天加入我們的電話會議，2023 年，特別是第四季度，標誌著 GigaCloud 的一個重要拐點，它改變了業務軌跡，我們相信這一點將會改變人們看待這個行業的方式。我們的業務規模和供應商履行評級模型的潛力都實現了數量級的躍升。在營收方面，我們看到本季營收增至 2.447 億美元，年增約 95%。

And for the full year revenue increased to $703.8 million, an increase of approximately 44% from 2022. While these are certainly impressive results, especially keeping in mind that the Noble House transaction did not close until 1, November. We believe that we have still not seen the full power of our business Synergia.

全年營收增至 7.038 億美元，較 2022 年成長約 44%。這些成果無疑令人印象深刻，尤其是考慮到 Noble House 交易直到 11 月 1 日才完成。我們相信，我們還沒有看到我們業務 Synergia 的全部力量。

In alignment with our integration with Noble House, we have taken strategic actions to further optimize this business. This includes streamlining Noble House operation by divesting its direct-to-consumer online retail triage and the manufacturing division. Additionally, we have outsourced the management of return. This has served two key objectives. First, by sharpening our focus, we ensure our concentration resources are directed towards strengthening our B2B marketplace propositions.

為了配合我們與Noble House的整合，我們採取了策略行動來進一步優化這項業務。這包括透過剝離其直接面向消費者的線上零售分類和製造部門來簡化 Noble House 的營運。此外，我們也外包了退貨管理。這達到了兩個關鍵目標。首先，透過加強我們的重點，我們確保我們的集中資源用於加強我們的 B2B 市場主張。

And secondly, we want to enhance our B2B market neutrality and are committed to provide that streamlined service to our buyers and sellers of the marketplace. Before passing it over to Iman to discuss our operational highlights, I want to remind everyone that you will see our first 10-K filed within the month. This year will represent our first year as S-1 filer we believe this is an important step to gain broader access to the international capital market and are pleased to have completed this transition in a timely fashion

其次，我們希望增強 B2B 市場的中立性，並致力於為市場買家和賣家提供簡化的服務。在交給 Iman 討論我們的營運亮點之前，我想提醒大家，您將在本月內看到我們提交的第一份 10-K 報告。今年將是我們作為 S-1 申報人的第一年，我們相信這是獲得更廣泛的國際資本市場准入的重要一步，並且很高興及時完成這一過渡

Going forward, GigaCloud will have the same reporting disclosure and filing obligation as other S-1 issuer. And you can expect that the same cadence of filings such as 10-Q and 10-K as you would from any domestic NASDAQ-listed company.

展望未來，GigaCloud 將承擔與其他 S-1 發行人相同的報告揭露和備案義務。您可以期待 10-Q 和 10-K 等文件的節奏與任何國內納斯達克上市公司相同。

With that, I would like to turn the call over to Iman.

說到這裡，我想把電話轉給伊曼。

Thank you, Larry, and thanks again to everyone for joining us. Our mission here at GigaCloud is to revolutionize the way suppliers and resellers manage big and bulky items. Our B2B marketplace streamlines the entire process, offering a seamless end-to-end experience and the successful integration of Noble House and Wondersign fueled this transformation through the integration of Noble House. We've expanded our sourcing origin to India and our operations into Canada with a warehouse in Milton, Ontario, In what we believe will be a strategic move to open our marketplace to even more buyers. We have also already onboarded some Noble House customers onto our B2B marketplaces buyers and will continue to recruit both suppliers and new buyers from the existing Noble House base of business.

謝謝你，拉里，並再次感謝大家加入我們。我們 GigaCloud 的使命是徹底改變供應商和經銷商管理大型物品的方式。我們的 B2B 市場簡化了整個流程，提供無縫的端到端體驗，Noble House 和 Wondersign 的成功整合透過 Noble House 的整合推動了這一轉變。我們已將我們的採購來源擴展到印度，並將我們的業務擴展到加拿大，並在安大略省米爾頓設有倉庫，我們相信這將是向更多買家開放我們市場的戰略舉措。我們也已經將一些 Noble House 客戶納入我們的 B2B 市場買家，並將繼續從 Noble House 現有業務基地招募供應商和新買家。

Finally, the financial plan for Noble House remains on track with a minimal net loss in the fourth quarter, positioning us favorably to achieve our goal of breakeven by the end of 2024 and profitability within six quarters. Clearly, we've made tremendous progress in our integration and execution plan we laid out for these acquisitions, which pushed GigaCloud further into a full service and to end B2B solution provider in the big and bulky landscape.

最後，Noble House 的財務計畫仍處於正軌，第四季淨虧損最小，這使我們有利於實現 2024 年底前盈虧平衡和六個季度內盈利的目標。顯然，我們在為這些收購制定的整合和執行計劃方面取得了巨大進展，這將 GigaCloud 進一步推向全面服務，並成為大型領域的終端 B2B 解決方案提供者。

Our Wondersign acquisition was a strategic entry into the brick-and-mortar space and has allowed us to begin work on the Giga IQ package, which will facilitate the seamless integration between retail systems and our constantly expanding B2B digital catalog for a more customer friendly, streamline and optimize transaction process. The beauty of the Wondersign integration and the future rollout of the Giga IQ package. The business model on the cloud side will remain similar, taking an order from the reseller and delivery through our supplier fulfilled retailing model directly to the end consumer.

我們收購 Wondersign 是進入實體領域的策略性舉措，使我們能夠開始開發 Giga IQ 軟體包，這將促進零售系統與我們不斷擴展的 B2B 數位目錄之間的無縫集成，從而為客戶提供更加友好、簡化和優化交易流程。 Wondersign 整合的美妙之處以及 Giga IQ 軟體包的未來推出。雲端的業務模式將保持相似，從經銷商接受訂單，並透過我們的供應商履行的零售模式直接交付給最終消費者。

This model opens up opportunities for GigaCloud marketplace to onboard new retailers. The integration of Wondersign and the development of our Giga IQ package is a testament to our excellent technology and R&D, primarily our in-house team of approximately 300 employees contributing to our R&D functions, including development of our prototype, proprietary cloud warehousing, collection of data and analytics and the design development and testing of our new GigaCloud marketplace.

這種模式為 GigaCloud 市場引進新零售商提供了機會。 Wondersign 的整合和 Giga IQ 包的開發證明了我們卓越的技術和研發，主要是我們約 300 名員工組成的內部團隊為我們的研發職能做出了貢獻，包括原型開發、專有雲倉儲、數據和分析以及我們新的GigaCloud 市場的設計開發和測試。

I also wanted to mention our addition of three new global 3P sellers with product origins in Mexico, Colombia and Turkey, which we announced in February. We are committed to continuously expanding our supplier network.

我還想提一下我們在 2 月宣布增加了三個新的全球 3P 賣家，產品原產地為墨西哥、哥倫比亞和土耳其。我們致力於不斷擴大我們的供應商網路。

This strategic approach diversifies our product portfolio and fosters supply chain redundancy, ensuring our buyers have uninterrupted access to products in a timely manner.

這種策略方法使我們的產品組合多樣化，並促進供應鏈冗餘，確保我們的買家能夠不間斷地及時獲取產品。

Now let's walk through some operational highlights. For the period ending December 31, 2023. Our GigaCloud Marketplace GMV grew approximately 53% year over year to $794.4 million in the TTM period. On the seller side, the platform signed approximately 46% increase in active 3P sellers, which ended at 815 for the quarter. As I've mentioned in the past, we see the expansion of our 3P ecosystem as a crucial aspect of our proud platform expansion and achieving scale in our supplier fulfilled retailing model.

現在讓我們來看看一些操作亮點。截至 2023 年 12 月 31 日的期間。我們的 GigaCloud Marketplace GMV 在 TTM 期間同比增長約 53% 至 7.944 億美元。在賣家方面，該平台簽約的活躍 3P 賣家數量增加了約 46%，本季末達到 815 家。正如我過去提到的，我們將 3P 生態系統的擴展視為我們引以自豪的平台擴展和實現供應商零售模式規模化的關鍵方面。

While we continue to devote a significant amount of time and resources into quickly vetting and onboarding new 3P sellers to our platform. We expect to see our acquisition and integration of Noble House continue to incrementally add a number of sellers to this number. We see our 3P seller marketplace GMV increased dramatically in the quarter, increasing approximately 65% year over year to $426.3 million in the TTM period. Overall, this accounted for approximately 54% of our total marketplace GMV in the same period.

同時，我們繼續投入大量時間和資源來快速審查新的 3P 賣家並將其引入我們的平台。我們預計，我們對 Noble House 的收購和整合將繼續為此數字增加更多賣家。我們看到我們的 3P 賣家市場 GMV 在本季大幅成長，在 TTM 期間年增約 65% 至 4.263 億美元。總體而言，這約占同期我們市場總 GMV 的 54%。

As I've mentioned on our prior calls, while our 1P approach remain an integral part of our business strategy. Ultimately, we believe that the growth of our organic 3P GMV will be very important to the scaling of our business, and we see positive momentum in our organic 3P growth rate continuing to drive a larger, more productive marketplace.

正如我在之前的電話會議中提到的，雖然我們的 1P 方法仍然是我們業務策略不可或缺的一部分。最終，我們相信有機 3P GMV 的成長對於我們業務的擴展非常重要，我們看到有機 3P 成長率的積極勢頭將繼續推動更大、更有效率的市場。

On the buyer side, we saw active buyers increased to over 5,000 in the 12 months prior period, an increase of approximately 21% from the year prior with average spend per active buyer accelerating 27% to approximately $159,000. This further demonstrates that we've been successful in attracting the type of high-quality seller we want on our platform.

在買家方面，我們看到活躍買家數量在前 12 個月內增加至超過 5,000 名，較前一年增加約 21%，每個活躍買家的平均支出增加 27%，達到約 159,000 美元。這進一步表明我們已經成功地在我們的平台上吸引了我們想要的高品質賣家。

Finally, I wanted to briefly mention the incident in one of our Japanese warehouses. First and foremost, there were no injuries to GigaCloud employees, contractors or anyone else. And the incident, the safety and the well-being of our people is paramount, and we are thankful for this outcome in terms of business impact, we have direct insurance coverage for our 1T inventory and involved in the incident.

最後，我想簡單提一下我們日本倉庫發生的事件。首先也是最重要的是，GigaCloud 員工、承包商或其他任何人都沒有受傷。在這次事件中，我們員工的安全和福祉至關重要，我們對這一結果對業務的影響表示感謝，我們為我們的 1T 庫存和參與該事件的產品提供了直接保險。

While we believe the facts are still developing, we have three other warehouses in Japan, and we have a plan in place to minimize any disruption to business in the region. We believe this situation is well in hand. However, we will update the market as necessary should there be material change in status.

雖然我們相信事實仍在發展，但我們在日本還有另外三個倉庫，我們已製定計劃以盡量減少對該地區業務的干擾。我們相信這種情況已經得到控制。但是，如果狀態發生重大變化，我們將根據需要更新市場。

Finally, I could not be more pleased with our results for the quarter and the year, and I am incredibly proud of our entire GigaCloud family, including those who recently joined from the Noble house and Wondersign from all over the world.

最後，我對我們本季和今年的業績感到非常滿意，我為我們整個 GigaCloud 家族感到無比自豪，包括最近從 Noble house 和 Wondersign 來自世界各地加入的人。

Our financial results were incredibly strong, including revenue for the quarter up approximately 95%. We are making excellent progress on the integration of Noble House and Wondersign with selective Noble house skews to be available in our marketplace starting today. We completed our transition to S-Filer, giving investors additional visibility into business and a consistent filing cadence. We expanded our warehouse footprint by over 100% ending the year with 8.2 million square feet of inventory space across 33 warehouses globally. We are seeing tremendous gain in our operational KPIs with our active buyers spend increasing over 27% and the buyer base increasing over 20%.

我們的財務業績非常強勁，包括本季的營收成長了約 95%。我們在 Noble House 和 Wondersign 的整合方面取得了巨大進展，並從今天開始在我們的市場上提供選擇性的 Noble House skew。我們完成了向 S-Filer 的過渡，為投資者提供了更多的業務可見度和一致的歸檔節奏。截至年底，我們的倉庫佔地面積擴大了 100% 以上，全球 33 個倉庫的庫存空間達到 820 萬平方英尺。我們看到我們的營運 KPI 取得了巨大的進步，我們的活躍買家支出增加了 27% 以上，買家基礎增加了 20% 以上。

And with that, I would like to turn the call over to David for a more detailed review of our financials.

說到這裡，我想把電話轉給大衛，讓他對我們的財務狀況進行更詳細的審查。

David

大衛

Thanks Iman, I'll now walk through our fourth quarter and full year numbers in more detail. Our total revenues for the fourth quarter were $244.7 million, which was an increase of 94.8% year over year and approximately 37.3% sequentially. On a full year basis, we generated $703.8 million, a 43.6% increase versus the year prior period.

謝謝伊曼，我現在將更詳細地介紹我們的第四季和全年數據。我們第四季的總營收為 2.447 億美元，年增 94.8%，季增約 37.3%。全年營收為 7.038 億美元，比上年同期成長 43.6%。

Breaking this down for just the fourth quarter, service revenue from GigaCloud 3P saw a 92% year over year increase to $69.3 million. Product revenue from GigaCloud, 1P saw a 50.9% year over year increased to $88.3 million.

僅就第四季而言，GigaCloud 3P 的服務營收年增 92%，達到 6,930 萬美元。 GigaCloud、1P的產品營收年增50.9%，達到8,830萬美元。

And product revenue from off-platform e-commerce saw a 179.7% year-over-year increase to $87 million. These increases correspond with a 53.3% year-over-year increase in total GigaCloud Marketplace GMV, which ended the full year at $794.4 million on a TTM basis.

平台外電商產品營收年增179.7%，達8,700萬美元。這些成長與 GigaCloud Marketplace 總 GMV 年成長 53.3% 相對應，全年結束時以 TTM 計算達到 7.944 億美元。

Our gross profit for the fourth quarter was $69.8 million, which was an increase of 161.4% year over year and resulted in gross margin of 28.5% versus 21.2% in the year prior period. On a full year basis, gross profit increased by 127% to $188.6 million, which resulted in a gross margin of 26.8% versus 17% in the year prior period.

我們第四季的毛利為 6,980 萬美元，年增 161.4%，毛利率為 28.5%，而去年同期為 21.2%。全年毛利成長 127%，達到 1.886 億美元，毛利率為 26.8%，去年同期為 17%。

I also wanted to briefly touch upon on ocean shipping rate fluctuation. The Red Sea incidents mostly affect routes from Asia into Europe, which is still a small part of our volume compared to the United States. We are already seeing the increased shipping rates from the most recent Red Sea incident starting to come down, and we're currently in the process of negotiating an attractive fixed price contract for a sizable portion of our shipping volumes soften the effects of these incidents going forward.

我還想簡單談談海運價格波動。紅海事件主要影響從亞洲到歐洲的航線，與美國相比，這仍然只占我們的一小部分。我們已經看到最近紅海事件導致的運費上漲開始下降，目前我們正在就相當大一部分運輸量談判一份有吸引力的固定價格合同，以減輕這些事件的影響向前。

Our cost of revenue in the fourth quarter of 2023 were $174.9 million, an increase of 76.8% from $98.9 million in the fourth quarter of '22. On a full year basis, cost of revenues in '23 were $515.2 million, the increase of 26.6% from $407 million in 2022.

2023 年第四季我們的營收成本為 1.749 億美元，比 2022 年第四季的 9,890 萬美元成長 76.8%。從全年來看，23 年的收入成本為 5.152 億美元，比 2022 年的 4.07 億美元成長了 26.6%。

Our total operating expense for the fourth quarter were $32.7 million, which was an increase of 181.9% year over year from $11.6 million. On a full year basis, total operating expenses were $78.6 million, which was an increase of 63.4% from $48.1 million in the year prior period.

第四季的總營運費用為 3,270 萬美元，較去年同期的 1,160 萬美元成長 181.9%。全年總營運費用為 7,860 萬美元，比上年同期的 4,810 萬美元增長 63.4%。

Breaking this down for just the fourth quarter, selling and marketing expenses increased 122.2% year over year to $14 million. General and admin expense increased 235.9% year over year to $13.1 million. R&D costs were $2.3 million in the fourth quarter of '23, an increase of 64.3% from fourth quarter of 2022. Increases were due to staff costs related to selling and marketing personnel, an increase in platform services fee for certain third-party e-commerce websites and system-wide technological upgrades on GigaCloud Marketplace.

僅就第四季而言，銷售和行銷費用年增 122.2%，達到 1,400 萬美元。一般及管理費用年增 235.9% 至 1,310 萬美元。 2023 年第四季的研發成本為 230 萬美元，較 2022 年第四季成長 64.3%。成長的原因是與銷售和行銷人員相關的員工成本、某些第三方電子平台的平台服務費增加。GigaCloud Marketplace 上的商業網站和系統範圍的技術升級。

I also want to be mentioned that we have not fully realized the cost synergies from Noble house at this time. We continue to expect realization of these synergies to occur throughout the year.

我還想指出的是，我們目前尚未完全實現 Noble house 的成本綜效。我們仍然預計這些協同效應將在全年實現。

On the bottom line. Our net income for the fourth quarter was $35.6 million, which was an increase of approximately 184.8% year over year from $12.5 million. This resulted in basic and diluted earnings per share of $0.87 versus $0.31 in the year ago period.

在底線上。我們第四季的淨利潤為 3,560 萬美元，較去年同期的 1,250 萬美元成長約 184.8%。這導致基本每股收益和稀釋每股收益為 0.87 美元，而去年同期為 0.31 美元。

On a full year basis, net income was $94.1 million for the period ending December 31, '23, resulting in basic and diluted earnings per share of $2.31 and $2.30 versus net income of $24 million in the year prior period, which resulted in basic and diluted earnings per share of $0.6. This resulted in adjusted EBITDA for the fourth quarter of '23 of $43.8 million, an increase of 188.2% year over year from $15.2 million. On a full year basis, we generated adjusted EBITDA of $108.3 million (sic - form 8-K, page 4, "$118.3 million") an increase of 183% compared to $41.8 million in the year prior period.

截至2023 年12 月31 日的全年淨利潤為9,410 萬美元，基本和稀釋每股收益分別為2.31 美元和2.30 美元，而上年同期淨利潤為2,400 萬美元，基本和稀釋每股收益為2,400萬美元。稀釋後每股收益為 0.6 美元。這導致 2023 年第四季調整後 EBITDA 達到 4,380 萬美元，較去年同期的 1,520 萬美元成長 188.2%。全年調整後 EBITDA 為 1.083 億美元（原文如此，表格 8-K，第 4 頁，「1.183 億美元」），與去年同期的 4,180 萬美元相比，成長了 183%。

Moving onto our balance sheet, we ended the fourth quarter with $183.3 million in cash on balance sheet, a net increase of approximately $40 million from the quarter ended December 31. I also want to mention that we currently have no outstanding borrowings on our debt-free. We do have a large noncurrent liability that's related to our warehouse lease.

轉向我們的資產負債表，第四季結束時，我們的資產負債表上有1.833 億美元的現金，比截至12 月31 日的季度淨增加約4000 萬美元。我還想提一下，我們目前的債務中沒有未償還的借款 -自由的。我們確實有大量與倉庫租賃相關的非流動負債。

As we mentioned in our investor deck, provided favorable cash on delivery terms for several Noble House suppliers, which were facing financial difficulties in the first quarter. We expect to see an associated impact on our free cash flow for the first quarter, resulting in less cash than usual flowing to our balance sheet. We anticipate the Noble house operation to start stabilizing in Q1 '24 and expect business to pick up in Q2 as new products are starting to roll in for the outdoor furniture season.

正如我們在投資者平台中提到的，為幾家 Noble House 供應商提供了有利的貨到付款條款，這些供應商在第一季面臨財務困難。我們預計第一季的自由現金流將受到相關影響，導致流向資產負債表的現金少於平常。我們預計 Noble house 的營運將在 2024 年第一季開始穩定，並預計業務將在第二季回升，因為新產品開始在戶外家具季節推出。

I also like to highlight at the time of the IPO, we have several VIE. in place across a number of jurisdictions today, I'm very pleased to announce that after a series of corporate reorganization, we have successfully converted these VIE. into fully owned subsidiaries of the company, and we do not have anymore VIEs in our corporate structure today.

我還想強調一下，在IPO時，我們有幾個VIE。今天，我很高興地宣布，經過一系列的企業重組，我們已經成功轉換了這些VIE。成為公司的全資子公司，目前我們的公司結構中不再有 VIE。

Finally, I want to briefly mention our financial outlook for currently expecting between $230 million to $240 million in revenue for the first quarter of 2024.

最後，我想簡單提一下我們的財務前景，目前預計 2024 年第一季的營收將在 2.3 億至 2.4 億美元之間。

Thank you all for joining. With that, I'd like to ask your operator to open the line for questions.

感謝大家的加入。因此，我想請您的接線生開通提問專線。

Thank you. (Operator Instructions)

謝謝。 （操作員說明）

Matt Koranda from ROTH MKM.

ROTH MKM 的 Matt Koranda。

Hey, guys, it's Mike on for Matt. Congrats on the quarter. Maybe just wanted to start with Noble house and the guide on how much exactly did Noble House contribute in the fourth quarter? I assume it was all in the Giga off-platform revenue, but just wanted to confirm there. And then was there any contribution in the fourth quarter to service revenue from onboarding, Noble house suppliers to the marketplace?

嘿，夥計們，麥克代替馬特。恭喜本季。也許只是想從 Noble House 開始，並了解 Noble House 在第四季度到底貢獻了多少？我認為這全部都在 Giga 平台外收入中，但只是想確認一下。那麼，第四季來自入職、Noble house 供應商對市場的服務收入有貢獻嗎？

Sure. Hey, Matt, it's David here. So right now, we have roughly $30 million of contributions coming in from Noble House, and we won't be breaking that out further. But this 10-K, you'll see that we have stand-alone financials of Noble House on in the quarter of 2023 Q4, there isn't a service revenue being contributed from Noble House. And as you said earlier, on the Noble house, our revenue is contributed from our off-platform product revenue.

當然。嘿，馬特，我是大衛。目前，我們從 Noble House 收到了大約 3000 萬美元的捐款，我們不會進一步透露這個數字。但這個 10-K，你會看到我們有 Noble House 在 2023 年第四季的獨立財務數據，Noble House 沒有貢獻任何服務收入。正如您之前所說，在Noble house，我們的收入來自我們的平台外產品收入。

Got it. Okay. That makes sense. And the 1Q guide calls for $235 million at the midpoint, any sense for what Noble House will contribute in the guide and any sense for service versus product revenue growth? Just trying to get to that $235 million and get a sense for growth in each category?

知道了。好的。這就說得通了。第一季指南要求中點為 2.35 億美元，Noble House 將在指南中做出什麼貢獻，以及服務與產品收入成長有何意義？只是想達到 2.35 億美元並了解每個類別的成長嗎？

Yes. Mike, I don't think we will be breaking out further because right now the Noble House business is now being fully integrated to our group from a reporting standpoint. But as I alluded earlier, I think the Noble House business stabilizing in Q1, and we're expecting the business to pick up in Q2. On the other hand, our organic business continued to scale and expand and we've actually established a pretty good market position, as you can see from our operational metrics. So all these factors are some of the things that we consider when we lay out our Q1 revenue guidance.

是的。麥克，我認為我們不會進一步突破，因為從報告的角度來看，Noble House 業務現在正在完全整合到我們的集團中。但正如我之前提到的，我認為 Noble House 業務在第一季趨於穩定，我們預計業務將在第二季回升。另一方面，我們的有機業務不斷擴大和擴大，我們實際上已經建立了相當好的市場地位，正如您從我們的營運指標中看到的那樣。因此，所有這些因素都是我們在製定第一季收入指引時考慮的一些因素。

Yes. Okay. And any sense for the service versus product revenue growth? I know we said we're integrating Noble House, but any way to think about service revenue growth was product revenue growth for the first quarter?

是的。好的。服務與產品收入成長有何意義？我知道我們說過我們正在整合 Noble House，但是有什麼方法可以將服務收入成長視為第一季的產品收入成長嗎？

Yes, I think what we're going to see is you'll see a bigger contribution from the product, given that the direct contribution from the Noble House directly into our product revenue on that, as you can see, we've always been that 70%, 30% split, and you'll probably see a bigger contribution coming in from product in Q1.

是的，我認為我們將看到的是，您將看到產品的更大貢獻，因為貴族之家直接對我們的產品收入做出了直接貢獻，正如您所看到的，我們一直在70% 、30% 的分配，你可能會看到第一季產品的貢獻更大。

Okay. That makes sense. Thanks so much. And the last one for me on gross margins, what exactly is driving the product revenue gross margin gross margins higher? It seems like it's probably a higher gross margin contribution from Noble House. But just any other inputs to call out that explain the 4Q strength in product gross margins?

好的。這就說得通了。非常感謝。最後一個問題是關於毛利率，到底是什麼推動產品收入毛利率更高？看起來這可能是Noble House 的更高毛利率貢獻。但有其他數據可以解釋第四季產品毛利率的強勁嗎？

Yes, I think the Noble House contribution is definitely there. I think another factor is, as you know, Q4 is a typical peak season for retail sales with a Black Friday, Cyber Monday we're able to generate a higher margin profile throughout those retail days. So that's kind of one of the reasons why you see an improving gross margin overall.

是的，我認為貴族之家的貢獻肯定是存在的。我認為另一個因素是，如您所知，第四季度是典型的零售旺季，有黑色星期五和網路星期一，我們能夠在這些零售日中產生更高的利潤率。這就是您看到整體毛利率提高的原因之一。

Got it. Okay. Very clear. Thanks, guys. That's all for me.

知道了。好的。非常清楚。多謝你們。這就是我的全部。

Sophie Huang, CMBI.

黃蘇菲，CMBI。

Okay. Thank you. Congratulations on a strong quarter and thank you for taking the question. I just have a follow-up question on the margin side. So how do you see the impact from freight fee change recently? And how do you view the margin trend in the next few quarters? (inaudible)

好的。謝謝。恭喜本季的強勁表現，並感謝您提出問題。我只是有一個關於保證金方面的後續問題。那麼您如何看待近期運費變化的影響呢？您如何看待未來幾季的利潤率趨勢？ （聽不清楚）

Hey, Sophie. Sorry, can I confirm your question is about whether we were able to sustain our margin profile going forward. I just want to make sure I understand the question correctly.

嘿，蘇菲。抱歉，我可以確認您的問題是關於我們未來是否能夠維持我們的利潤狀況。我只是想確保我正確理解這個問題。

Yes, the margin trend.

是的，保證金趨勢。

Yes, on so as I discussed earlier, I think Q4 was a good year because of the typical retail peak season. I think going forward, obviously, we're trying to maintain that. But also, we're also facing some macro challenges and are things like softening of the housing market, elevated shipping rates, which we discussed a little bit earlier that we're actually in the process of negotiating a fixed price contract for some of our volume. So the management team and actually trying to steer the company through these challenges, we'll do our best to maintain that profile, but kind of the situation we're in right now.

是的，正如我之前討論的那樣，由於典型的零售旺季，我認為第四季是一個好年。我認為，顯然，我們正在努力維持這一點。而且，我們還面臨著一些宏觀挑戰，例如房地產市場疲軟、運費上漲，我們之前討論過，我們實際上正在為我們的一些產品談判固定價格合約。體積。因此，管理團隊並實際試圖引導公司應對這些挑戰，我們將盡最大努力保持這種形象，但我們現在所處的情況就是這樣。

Okay. And the second question is about your global expansion strategy. Can you shed more color on the performance of different markets? I remember you said that the [European] market has the highest revenue growth and you also expand the Canada market after Noble House consolidation. So how do you view the opportunity for new revenue recognition from those non-US markets in the long run?

好的。第二個問題是關於你們的全球擴張策略。能否詳細介紹不同市場的表現？我記得您說過[歐洲]市場的收入成長最高，在Noble House整合後您也擴大了加拿大市場。那麼，從長遠來看，您如何看待這些非美國市場新收入確認的機會？

Iman, you want to take that one around our global expansion.

伊曼，你想利用這一點來推動我們的全球擴張。

Sure. So as far as the total addressable market in the US, we're looking at an industry within furniture, our biggest, vertical of almost $65 billion and as you mentioned, Europe has been a tremendous market for us as far as growth. And you also saw that, you know, we have onboarded three new 3P sellers from different regions Turkey, Colombia and Mexico.

當然。就美國的整個潛在市場而言，我們正在關注家具產業，這是我們最大的垂直產業，價值近 650 億美元，正如您所提到的，就成長而言，歐洲一直是我們的龐大市場。您還看到，我們已經引進了來自土耳其、哥倫比亞和墨西哥等不同地區的三位新 3P 賣家。

So what we're going to continue to see is a global evolution of the business in the GigaCloud marketplaces adopted in more and more marketplaces, while our primary market in the United States would still be the growth driver going forward, the European market will be right behind it.

因此，我們將繼續看到越來越多的市場採用 GigaCloud 市場的全球業務演變，而我們在美國的主要市場仍將是未來的成長動力，歐洲市場將是就在它後面。

Okay, thank you. And the last one, can you explain more about your R&D expenses, [$2.9 million] R&D expenses, clearly low for a company of this size

好的謝謝。最後一個，你能解釋一下你們的研發費用嗎，[290萬美元]研發費用，對於這種規模的公司來說顯然很低

Yes. Maybe I'll take this one actually is a very quick question, and I'm very glad you brought it up yet. We incurred close to $4 million in R&D expense in 2023. And as Iman alluded earlier, we have over 300 team members dedicated to our R&D efforts, which includes developing and testing of our platform, collection of data and analytics, et cetera. Some of that R&D efforts are actually being accounted for in our costs. So therefore, our total cash, our cost associated with R&D is actually far larger than the $4 million that you see in our R&D expense in our P&L.

是的。也許我會接受這個問題，這實際上是一個非常簡短的問題，我很高興你提出了這個問題。 2023 年，我們的研發費用接近 400 萬美元。正如 Iman 先前所提到的，我們有 300 多名團隊成員致力於研發工作，其中包括平台的開發和測試、資料收集和分析等。其中一些研發工作實際上已計入我們的成本中。因此，我們的總現金、與研發相關的成本實際上遠遠大於您在損益表中看到的研發費用中的 400 萬美元。

Okay, thank you. Very clean. Thank you.

好的謝謝。很乾淨。謝謝。

Brian Kinstlinger from Alliance Global Partners.

聯盟全球合作夥伴的布萊恩‧金斯林格 (Brian Kinslinger)。

Thanks so much for taking my questions. From an organic growth perspective, I may have missed it. Can you highlight the number of SKU's your platform had at the end of the year versus the end of 2022? And then I'm curious if you're seeing strengthening demand per SKU on average in the fourth quarter, maybe compared to last year or even the first half of the year?

非常感謝您回答我的問題。從有機成長的角度來看，我可能錯過了。您能否重點介紹一下您的平台在年底與 2022 年底擁有的 SKU 數量？我很好奇，與去年甚至上半年相比，第四季度每個 SKU 的平均需求是否有所增加？

Yes, Brian, I think on the SKU point, I don't have the exact number in front of me. But if I recall, we have roughly 30,000 SKUs as of the end of last year. And I think that number for 2022 is somewhere in that 20,000 range.

是的，布萊恩，我認為在 SKU 問題上，我面前沒有確切的數字。但我記得截至去年底我們大約有 30,000 個 SKU。我認為 2022 年的數字在 20,000 範圍內。

Great. And then on the demand side, I think in the first half of the year, demand per SKU on average was down because of that change in the fourth quarter. Are you starting to see strengthening demand on your SKUs.

偉大的。然後在需求方面，我認為今年上半年，由於第四季度的變化，每個 SKU 的平均需求有所下降。您是否開始看到對您的 SKU 的需求不斷增加？

Iman, you want to do that or --?

伊曼，你想這麼做還是──？

I'll be more than happy to David. Hi, Brian. So obviously, when it comes to home furnishings, you know the entire industry is still experiencing and the headwind with the cooling of the housing market and the softening of the consumer spending under durable goods. And but with our business model, we're really well positioned in a very slow growth market. And as far as you know, the SKU density and the performance, we don't really make that information available. But by default, some of the best metrics to look at is the growth in the 3P supplier base. And on the reverse side, the average spends per active buyer up 27%, while the base of the buyers grew by 20% to over 5,000.

我會對大衛感到非常高興。嗨，布萊恩。顯然，就家居用品而言，整個產業仍在經歷房地產市場降溫和耐用品消費支出疲軟的逆風。但憑藉我們的商業模式，我們在成長非常緩慢的市場中確實處於有利地位。據您所知，SKU 密度和性能，我們並沒有真正提供這些資訊。但預設情況下，一些值得關注的最佳指標是 3P 供應商基礎的成長。另一方面，每位活躍買家的平均支出增加了 27%，而買家基數增加了 20%，達到 5,000 多人。

Got it, thank you. And a little bit more forward looking if you can, I mean, you've done great at growing the SKU count? I know you made acquisitions that will drive an increase, but again, from an organic basis, can you continue to rapidly grow the number of SKU's?

收到了。謝謝。如果可以的話，更具前瞻性一點，我的意思是，您在增加 SKU 數量方面做得很好？我知道您進行的收購將推動成長，但同樣，從有機的角度來看，您能否繼續快速增加 SKU 的數量？

Yeah, we're pretty confident on growing SKUs of both on the one side and now that we acquired Noble House, which directly give us access to 8,000 new SKUs from the Noble house business. And so there are a lot of new ways for us to kind of keep growing the SKU number.

是的，我們對一方面增加兩者的 SKU 非常有信心，現在我們收購了 Noble House，這使我們能夠直接獲得 Noble House 業務中的 8,000 個新 SKU。因此，我們有許多新方法可以不斷增加 SKU 數量。

Great. Lastly, maybe for David, can you quantify the cost synergies you realized from the recent acquisitions thus far? And then you talked about a big chunk of them will be realized and again in 2024. Can you talk about maybe what those can you quantify those synergies?

偉大的。最後，也許對於大衛來說，您能否量化迄今為止從最近的收購中實現的成本協同效應？然後您談到其中很大一部分將在 2024 年實現並再次實現。您能否談談您可以量化哪些協同效應？

Yes. I guess it's kind of hard for me to quantify what the synergies are from both a revenue or a cost savings standpoint at this point. And what we can see from the health of the business is that we basically incurred a minimal loss in Q4, and Q1 is starting to stabilize. We got new products coming in for the outdoor freshman season. And so Q2, we expect there's going to be a pickup from the business. So that's kind of the health of the business. But hard for me to actually quantify what those synergies are at this point in time.

是的。我想我目前很難從收入或成本節約的角度來量化綜效。從業務的健康狀況來看，我們第四季的虧損基本上是最小的，第一季開始趨於穩定。我們為戶外新生季節推出了新產品。因此，我們預計第二季業務將會回升。這就是企業的健康狀況。但目前我很難真正量化這些協同效應。

Great. Congrats on a great 2023.

偉大的。恭喜您度過了美好的 2023 年。

Thanks, Brian.

謝謝，布萊恩。

Rommel Dionisio, Aegis Capital.

隆美爾·迪奧尼西奧，宙斯盾資本。

Thank you. Good morning. I wonder if I could just inquire about the new repeat business from Colombia and Mexico. Could you just maybe describe a little more detail how you know, the potential evolution there of that region of the world, which is you haven't talked about too much in the past. And also are you going to report the building of infrastructure sales force? I wonder if you could talk about how, you see that potential market opportunity playing out here over the next few years and the long-term opportunity. Thank you.

謝謝。早安.我想知道是否可以詢問一下來自哥倫比亞和墨西哥的新回頭客業務。您能否更詳細地描述一下您是如何知道的，世界該地區的潛在演變，這是您過去沒有談論太多的。您還打算報告基礎設施銷售團隊的建置嗎？我想知道您是否可以談談您如何看待未來幾年潛在的市場機會以及長期機會。謝謝。

Thank you, Rommel. As far as the new sellers on as good cloud is getting more known and known and in the global arena as a better way to make trade and to the market. I think you know, organically, we're going to see an interest coming from a lot of the global supply for the suppliers into regions we do not currently operate and into becoming members.

謝謝你，隆美爾。就新賣家而言，良好的雲端正在變得越來越知名，並且在全球舞台上作為一種更好的交易和市場方式。我想你知道，從有機方面來說，我們將會看到許多全球供應商對我們目前沒有經營的地區產生興趣並成為會員。

In addition, you know, like you know, as far as recruitment of sellers, the existing infrastructure can support the expansion without reach into if the need be we can definitely expand into the region. But those of the countries that you mentioned are new to the marketplace that kind of speaks volume to the true reach of GigaCloud business model globally as a better way of doing big and bulky. Because in reality, we kind of transformed the industry into making it more seamless end-to-end in a better way of trading for big and bulky.

另外，你知道，如你所知，就招募賣家而言，現有的基礎設施可以支援擴張，而無需觸及，如果需要的話，我們絕對可以擴張到該地區。但您提到的那些國家是市場新手，這足以說明 GigaCloud 商業模式在全球範圍內的真正影響力，這是一種更好的做大做強的方式。因為實際上，我們對這個行業進行了改造，以更好的方式進行大宗商品的交易，使其端到端更加無縫。

So with that being said, I do expect the same trend to continue. As you know, we get to share our story with more and more manufacturers and distributors across the board, to see them onboarding and adopting the business model.

話雖如此，我確實預計同樣的趨勢將繼續下去。如您所知，我們可以與越來越多的製造商和分銷商分享我們的故事，看到他們加入並採用這種商業模式。

Okay. Thanks very much and congratulations on the on the quarter.

好的。非常感謝並祝賀本季的業績。

Thank you, Rommel

謝謝你，隆美爾

Thank you. We'll now move on to our next question, please standby. There are no further questions at this time. So I'll hand the call back to David Lau for closing remarks.

謝謝。我們現在進入下一個問題，請稍候。目前沒有其他問題。因此，我會將電話轉回給 David Lau，讓其致閉幕詞。

Thank you for your continued support in the business and please feel free to contact us. Should you have any further questions, and we look forward to speaking with you all in our next earning announcement. And have a nice day. Thank you.

感謝您對業務的持續支持，請隨時與我們聯繫。如果您還有任何其他問題，我們期待在下一次收益公告中與您交談。祝你有愉快的一天。謝謝。

Concludes today's conference call. Thank you for participating. You may now disconnect. Speakers, please standby.

今天的電話會議結束。感謝您的參與。您現在可以斷開連線。各位發言者，請待機。